The Workers Adjustment and Retraining Notification Act (WARN) mandates that employers who meet certain criteria provide early notice of an impending layoff or termination to impacted workers. This process allows employers to make difficult business decisions and streamline their workforce, while still providing protections to employees. Upon receipt of a WARN notice, employees can receive assistance through the State Rapid Response Unit to find new employment.
What Are The WARN Act Requirements?
The Workers Adjustment and Retraining Act was passed into law in 1988 and demands that large companies offer at least a 60-day notice to all employees before a mass layoff or plant closing affecting at least 50 employees. The WARN Act is also triggered if an employer lays off 500 or more workers at a single site of employment during a 30-day period or lays off between 50-499 workers, which constitutes 33% of the employer’s active workforce at a single site of employment.
Finally, the WARN Act can also come into play if an employer announces a temporary layoff of less than six months that meets the foregoing criteria and then decides to extend the layoff for more than six months, or if an employer reduces the hours of work for 50 or more workers by more than 50% for each month in a six-month period.
Does The WARN Act Apply To Your Company?
In Ohio and across the United States, entrepreneurs who operate a for-profit or private, non-profit company that employs at least 100 workers must abide by the specifications outlined in the WARN Act. Even if a company does not have 100 employees with full-time status, it still needs to comply with this law if its staff collectively works a minimum of 4,000 hours per week.
Common Exemptions For Employers
The WARN Act includes exceptions to the law for employers under certain circumstances. For example, if uncontrollable or unforeseen circumstances occurred that caused significant damage to the business, employers may not be compelled to provide a 60-day notice of termination.
Companies that are financially suffering and are attempting to bring in business may also not be required to provide advance notice of a layoff because preemptively announcing a mass layoff could negatively impact their ability to stay in business.
Businesses may also qualify for a potential exemption if a natural disaster occurs.
What Are The Penalties For Violating The WARN Act?
Adhering to federal and state regulations is imperative for employers, as failing to do so could lead to substantial liability. Employers who do not adequately provide the WARN notice to a local unit of government may be obligated to pay a civil penalty of $500 or less for each day they are in violation of the law. Businesses that compensate their employees within three weeks of a mass layoff or plant closure can shield themselves from this potential fine.
Companies may also be financially responsible for any compensation and potential benefits owed to employees while they were found to be acting in violation of the WARN Act. Additionally, employers may be accountable for attorney’s fees if a former employee pursues legal action.
Adhering to the WARN Act should be a priority for qualifying Ohio employers, as violating the law could lead to severe legal and financial ramifications. To learn more about the WARN Act and the possible exemptions to the law, contact Cavitch employment attorney Madilyn M. Maruna.